It’s setting up to be one hell of a fight. In one corner we’ve got Tech Company v Oregon. Further down the card we’ve got Oregon v. the Feds.
Cover Oregon was supposed be the Obamacare healthcare exchange. Oregon was given millions and charged with creating a healthcare exchange to bring health insurance into the new age of ease and affordability. Nothing could be further from the truth. Here’s what really happened. Hundreds of millions in federal monies were spent by a tech company and on political hacks to run the website to create the Cover Oregon web site. Somehow, all the money is gone and the web site never functioned. Not one Oregonian ever signed up.
Oregon Attorney General Ellen Rosenblum filed suit against a tech company last year stating the software giant, “repeatedly lied and defrauded the state during the course of its work on the failed Cover Oregon health exchange. Through this legal action, we intend to make our state whole and make sure taxpayers aren’t left holding the bag.” The problem is that the state or Oregon was the ones who were self-dealing and incompetent in rolling out the web site.
The lawsuit is going to be a pretty tall order to fill. Which taxpayers? And how is this lawsuit going to make Oregon whole? The Feds are interested in getting their money back, too. So no matter what Oregon settles with the company for, it will have to argue with the Feds to keep any of that money. Vegas odds are that Oregon is not going to get to keep any of the recovered funds. Recent correspondence between Acting Centers for Medicare and Medicaid Services Administrator Andrew Slavitt and a couple of key Senior Senators (Grassley and Hatch) highlights that the Federal government has an interest in getting their money back. Having an interest is one thing, actually getting a check from Oregon is another. The lawyers are definitely the ones cleaning up on this fiasco.
Maryland has a similar situation and recently settled with one of its contractors, Noridian, for $45 million. They never had a working exchange either. CMS Director Slavitt wrote, “CMS is working with the Maryland (exchange) so that funds are returned to the Treasury. Oregon is also taking legal action against its contractors. CMS will work with Oregon and Massachusetts so that the appropriate funds are returned.” Why is it that contractors are somehow always to blame for these websites failing? Why is it these wildly successful companies all of a sudden forget how to do their job when they work for state governments? Maybe it is because they are not the problem.
How is the federal government going to get the money back? Oregon and Massachusetts didn’t have much accountability when it came to managing the funds in the first place. How can they be trusted to give it back? This feels like yet another example of the taxpayer getting the shaft. The two men tasked with bringing down the hammer on these two wayward states are Senator Orrin Hatch, who chairs the Finance Committee, and Senator Charles Grassley, who chairs the Judiciary Committee. They replied to CMS Director Slavitt, “It’s not clear what specifically the federal government is doing to recoup the Maryland money. The same can be said for Oregon’s [marketplace], which spent more than $300 million in federal funds and failed to sign up a single person.” A spokeswoman for the Oregon DA Rosenblum said this about federal repayment, “A lot depends on what kind of damages the state is awarded from the court.”
No it doesn’t matter. Oregon (And Maryland) owes the Feds millions. It’s time to make them pay it back one way or another.
This is like a parent giving a teenager $5000 to buy a car. The teen gives the money to a car salesman who promises to deliver the car tomorrow. Of course, he never shows up with the car. Then the teenager sues the car salesman for $10,000. The parent then says, I want my $5000 back from the legal settlement with the car dealership and then the teen answers, maybe, we’ll see how much I get ,and then I’ll decide what I will give back. That would be the time for the parent to punish the teen in any way possible to be sure they got their $5000 back.
Now is the time for Grassley and Hatch to figure out a way to punish these states that squandered millions of dollars of taxpayer money and find a way to make them pay it back one way or another, lawsuit or not. It’s time for someone to be the grown up. Senators Grassley and Hatch are just the guys to do it.